March 30, 2017
About the author :
Joni holds a PhD in marketing. He is currently working as a postdoctoral researcher at Qatar Computing Research Institute and Turku School of Economics. Contact: joolsa (at) utu.fi
Too often, marketing is thought of being advertising and nothing more. However, already Levitt (1960) and Kotler (1970) established that marketing is a strategic priority. Many organizations, perhaps due to lack of marketers in their executive boards, have since forgotten this imperative.
Another reason for decreased importance of marketing is due to marketing scholars pushing the idea that “everything is marketing” which leads to decay of the marketing concept – if it is everything, it is nothing.
Nevertheless, if we reject the omni-marketing concept and return to the useful way of perceiving marketing, we observe the linkage between marketing and strategy.
Tania Fowler wrote a great piece on marketing, citing some ideas of Professor Roger Martin’s HBR article (2014). Drawing from that article, the basic strategic marketing questions are:
This is a good start, but we need to expand the list of questions. Borrowing from Osterwalder (2009) and McCarthy (1960), let’s apply BMC (9 dimensions of a business model) and 4P marketing mix thinking (Product, Place, Promotion, Price).
This leads to the following set of questions:
Basically, each question can be presented as a question of “now” and “future”, whereupon we can identify strategic gaps. Strategy is a lot about seeing one step ahead — the thing is, foresight should be based on some kind of realism, or else fallacies take the place of rationality. Another point from marketing and startup literature is that people are not buying products, but solutions (solution-based selling, product-market fit, etc.) Someone said the same thing about brands, but I think solution is more accurate in the strategic context.
The major downside of BMC and 4P thinking from strategic perspective is their oversight of competition. Therefore, borrowing from Ries and Trout (1972) and Porter (1980), we add these questions:
Defining the competitive advantage, or critical success factors (CSFs), leads into natural linkage to resources, as we need to ask what are the resources we need to execute, and how to acquire and commit those resources (often human capital).
Therefore, I’m turning to resource-based thinking in asking:
Indeed, company culture is a strategic imperative which is often ignored in strategic decision making. Nowadays, perhaps more than ever, great companies are built on talent and competence. Related strategic management literature deals with dynamic capabilities (e.g., Teece, 2007) and resource-based view (RBV) (e.g., Wernerfelt, 1984). In practice, companies like Facebook and Google do everything possible to attract and retain the brightest minds.
Finally, even the dreaded advertising questions have a strategic nature, relating to customer acquisition and loyalty, as well as ROI in regards to both as well as to our offering. Considering this, we add:
As you can see, these questions are of strategic nature, too, because they are directly linked to revenue and customer. After all, business is about creating customers, as stated by Peter Drucker. However, Drucker also maintained that a business with no repeat customers is no business at all. Thus, marketing often focuses on customer acquisition and loyalty.
Here are the questions in one list:
The list should be universally applicable to all companies. But filling in the list is not “oh, let me guess” type of exercise. As you can see, answering to many questions requires customer and competitor insight that, as the startup guru Steve Blank says, needs to be retrieved by getting out of the building. Those activities are time-consuming and costly. But only if the base information is accurate, strategic planning serves a purpose. So don’t fall prey to guesswork fallacy.
One of the most important things in strategic planning is iteration — it’s not “set and forget”, but “rinse and repeat”. So, asking these questions should be repeated from time to time. However, people tend to forget repetition. That’s why corporations often use consultants — they need fresh eyes to spot opportunities they’re missing due to organizational myopia.
Moreover, communicating the answers across the organization is crucial. Having a shared vision ensures each atomic decision maker is able to act in the best possible way, enabling adaptive or emergent strategy as opposed to planned strategy (Mintzberg, 1978). For this to truly work, customer insight needs to be internalized by everyone in the organization. In other words, strategic information needs to be made transparent (which it is not, in most organizations).
And for the information to translate into action, the organization should be built to be nimble; empowering people, distributing power and reducing unnecessary hierarchy. People are not stupid: give them a vision and your trust, and they will work for a common cause. Keep them in silos and treat them as sub-ordinates, and they become passive employees instead of psychological owners.
We can say that marketing is a strategic priority, or that strategic planning depends on the marketing function. Either way, marketing questions are strategic questions. In fact, strategic management and strategic marketing are highly overlapping concepts. Considering both research and practice, their division can be seen artificial and even counter-productive. For example, strategic management scholars and marketing scholars may speak of the same things with different names. The same applies to the relationship between CEOs and marketing executives. Joining forces reduces redundancy and leads to a better future of strategic decision-making.